MIRA
INFORM REPORT
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Report Date : |
14.07.2008 |
IDENTIFICATION
DETAILS
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Name : |
NAGASE & CO LTD |
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Registered Office : |
1-1-17 Shinmachi Nishiku Osaka 550-8668 |
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Country : |
Japan |
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Financials (as on) : |
31.03.2007 |
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Date of Incorporation : |
December 1917 |
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Legal Form : |
Limited Company (Kabushiki Kaisha) |
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Line of Business : |
Import, Export, Wholesale of Chemicals |
RATING &
COMMENTS
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MIRA’s Rating : |
Aa |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
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Maximum Credit Limit : |
YEN 28,298.8 Million |
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Status : |
Very Good |
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Payment Behaviour : |
Regular |
name & address
NAGASE & CO
LTD
REGD NAME: Nagase Sangyo KK
MAIN OFFICE: 1-1-17 Shinmachi Nishiku Osaka 550-8668 JAPAN
Tel:
06-6535-2114 Fax: 06-6535-2160
* TOKYO OFFICE: 5-1 Nihombashi-Kobunacho Chuoku Tokyo, as
given
E-Mail address:info@nagase.co.jp
ACTIVITIES
Import, export, wholesale of chemicals
BRANCHES
Tokyo, Nagoya, Fukuoka, Hiroshima, Takamatsu, other
OVERSEAS
USA (6), Canada, UK, Germany, China (14), Taiwan (2), Korea (2), Thailand (2), Malaysia (3), Singapore (3), Vietnam (3), India, Indonesia, UAE, other
CHIEF EXEC
HIROSHI NAGASE, PRES & CEO
Yen Amount: In
million Yen, unless otherwise stated
SUMMARY
FINANCES FAIR A/SALES Yen 764,755 M
PAYMENTS REGULAR CAPITAL Yen 9,699 M
TREND STEADY WORTH Yen 208,377 M
STARTED 1917 EMPLOYES 4,335
COMMENT
TOP-RANKED
TRADING HOUSE SPECIALIZING IN INDUSTIRAL CHEMICALS. FINANCIAL SITUATION CONSIDERED FAIR AND GOOD FOR CREDIT
ENGAGEMENTS:
US$3,125,000 / O/A 60 DAYS.
MAX CREDIT LIMIT
YEN 28,298.8 MILLION, 30 DAYS NORMAL TERMS.
Forecast
(or estimated) figures for 31/03/2009 fiscal term
HIGHLIGHTS
The subject company is
top-ranked trading house specializing in industrial chemicals, founded
originally in 1832 by a certain Nagase as a dyestuff merchant in Kyoto. In 1900, established business ties with
Bassel Chemical of Switz (now Chiba Specialty Chemicals) and since diversified
into various other industrial chemicals.
Excels in dyestuffs, synthetic resins, etc. Actively engaged in new technological sector such as
pharmaceuticals raw materials, specialty resins, biotechnology, electronics and
other new materials. In Oct 2003 the
firm set up JV’s in Taiwan and China for offering CAD auto-parts design
services, following the one set up in USA.
The firm is reported purchased Pac Tec GmbH, a German producer of
semiconductor mfg equipment. Nagase is
taking steps to expand its business in latter-stage semiconductor mfg and is
planning to use Pac Tech’s technologies to gain ground in supplying equipment
and materials. Since 2000, the firm has
served as agent for Pac Tech, selling the firm’s equipment and licensing
technology in Japan. Aggressive in
investment, including M&A activities, in electronics, automobile and
healthcare areas. In July 2007, started
lab center for materials and additive agents.
Business in India and Vietnam continues expanding.
(Recent News from the Nikkei Shimbun):
The
firm issued on July 11 voluntary recall for some 460,000 DVD players and other
products made in China due to a “risk of fire”. By this, the firm will cease sales of these DVD in Japan. The incident is expected to cost the firm
some Yen 14,000 million, nearly matching the firm’s initial projection for
group net profit for the term ending Mar 2008.
The group net profit may shrink to about Yen 7,000 million, according to
reports.
FINANCIAL INFORMATION
The sales volume for Mar/2008
fiscal term amounted to Yen 764,755 million, a 9.0% up from Yen 701,321 million
in the previous term. Sales in China
expanded mainly in the automotive sector.
Chemical products and synthetic resins continued growth, mainly for
automobiles both at home and abroad.
Rising materials prices also contributed. Sales of LCD components expanded. Electronics parts and healthcare goods similarly grew. By divisions, Chemicals up 8.4% to Yen
267,830 million, as a result of strong sales of plastic raw materials &
additives; Plastics up 12.3% to Yen 274,660 million, with sales to automotive
industry increasing sharply; Electronics up 8.6% to Yen 163,830 million, with
LCD components sales expanded; Life Science up 5.5% to Yen 56,480 million, with
pharmaceutical raw materials & intermediates in fine chemicals business
expanded. The recurring profit was posted at Yen 24,823 million and the net
profit at Yen 10,005 million, respectively, compared with Yen 123,231 million
recurring profit and Yen 123,567 million net profit, respectively, a year
ago. The recall of DVD players resulted
in extraordinary loss of Yen 6,480,000 million, causing net profit to decrease 26.3%
to Yen 10,005 million.
For
the current term ending Mar 2009 the recurring profit is projected at Yen
22,000 million and the net profit at Yen 11,000 million, respectively, on a
0.7% rise in turnover, to Yen 770,000
million. Synthetic resins advancing
on firm Asia-bound demand. Business in
India and Vietnam is expected to grow.
The
financial situation is considered FAIR and good for ORDINARY business
engagements. Max credit limit is
estimated at Yen 28,298.8 million, on 30 days normal terms. The proposed amount for 60 days is
considered well within the firm’s financial capacities.
REGISTRATION
Date
Registered: Dec 1917
Legal
Status: Limited Company (Kabushiki Kaisha)
Authorized: 346,980,000
shares
Issued: 138,408,285
shares
Sum: Yen 9,699 million
Major shareholders (%)
Master
Trust Bank of Japan (7.7), Company’s Treasury Stock (7.0), Japan Trustee Services Bank T (4.8), Sumitomo Trust Bank
(4.1), Northern Trust (AVFC) American (3.6), Nippon Life Ins (3.3), SMBC (3.1),
Hiroshi Nagase (3.0), Reiko Nagase (2.5),
Mitsui Sumitomo Ins (2.1); foreign owners (18.0)
No. of shareholders: 4,225
Listed on the S/Exchange (s) of
Tokyo, Osaka
Managements
Hideo
Nagase, ch; Hiroshi Nagase, pres & CEO; Makoto Tsuruoka, s/mgn dir; Kyoichi
Zushi, s/mgn dir; Reiji Nagase, mgn dir; Eiji Asami, mgn dir; Shingo Bamba, mgn
dir; Kazuo Nagashima, dir
Nothing detrimental is known as to the commercial morality
of executives.
Related companies
Nagase
Chemtex, Totaku Ind, Hoei Sangyo, Nagase Logistics, other
OPERATION
Activities:
Specialized trading house for import, export, wholesale of industrial chemicals
(Sales breakdown by divisions):
dyestuffs, pigments, other industrial chemicals (35%), synthetic resins (36%), electronic materials & equipment (21%),
health-care products, foodstuffs,
others (8%).
(Overseas sales ratio 43.4%: N/E
Asia 24.6%; S/E Asia 12.9%; North America 3.4%; Europe, others 2.5%).
Clients
[Chemical mfrs, wholesalers] Sekisui
Chemical, Nippon Paint, Dainippon Ink & Chemicals,
Sumitomo Chemical, Mitsubishi Motors, Otsuka Pharmaceutical, Shinto Paint, Fujitsu Ltd, Toshiba Matsushita Display
Technology, Kansai Paint, Mitsubishi Electric
Trading, Kasai Kogyo, other.
No. of accounts: 2,000
Domestic areas of activities: Nationwide
Suppliers
[Mfrs,
wholesalers] Sumitomo Chemical, Daicel Chemical Ind, Nippon Shokubai, Mitsubishi Chemical, Tottori Sanyo Electric,
other.
Payment record: Regular
Location
Business
area in Osaka. Office premises at the
caption address are leased and maintained satisfactorily.
Bank References
SMBC Bank (H/O)
Mizuho Corporate Bank (Ohtemachi)
Relations: Satisfactory
FINANCES
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FINANCES: (Consolidated
in million yen) |
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Terms Ending: |
31/03/2008 |
31/03/2007 |
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INCOME STATEMENT |
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Annual Sales |
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764,755 |
701,321 |
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Cost of Sales |
684,248 |
627,681 |
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GROSS PROFIT |
80,506 |
73,639 |
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Selling & Adm Costs |
57,443 |
51,970 |
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OPERATING PROFIT |
23,063 |
21,669 |
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Non-Operating P/L |
1,760 |
1,562 |
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RECURRING PROFIT |
24,823 |
23,231 |
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NET PROFIT |
10,005 |
13,567 |
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BALANCE SHEET |
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Cash |
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23,490 |
21,922 |
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Receivables |
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231,823 |
218,037 |
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Inventory |
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42,946 |
43,372 |
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Securities, Marketable |
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Other Current Assets |
11,356 |
8,295 |
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TOTAL CURRENT ASSETS |
309,615 |
291,626 |
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Property & Equipment |
35,837 |
31,834 |
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Intangibles |
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3,375 |
2,944 |
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Investments, Other Fixed Assets |
71,042 |
96,455 |
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TOTAL ASSETS |
419,869 |
422,859 |
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Payables |
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134,864 |
141,461 |
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Short-Term Bank Loans |
24,348 |
14,207 |
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Other Current Liabs |
24,725 |
21,446 |
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TOTAL CURRENT LIABS |
183,937 |
177,114 |
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Debentures |
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Long-Term Bank Loans |
8,993 |
6,284 |
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Reserve for Retirement Allw |
6,691 |
6,851 |
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Other Debts |
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11,871 |
20,938 |
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TOTAL LIABILITIES |
211,492 |
211,187 |
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MINORITY INTERESTS |
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Common
stock |
9,699 |
9,699 |
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Additional
paid-in capital |
10,017 |
9,926 |
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Retained
earnings |
165,664 |
156,749 |
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Evaluation
p/l on investments/securities |
18,613 |
32,348 |
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Others |
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9,726 |
8,363 |
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Treasury
stock, at cost |
(5,342) |
(5,413) |
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TOTAL S/HOLDERS` EQUITY |
208,377 |
211,672 |
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TOTAL EQUITIES |
419,869 |
422,859 |
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CONSOLIDATED CASH FLOWS |
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Terms ending: |
31/03/2008 |
31/03/2007 |
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Cash
Flows from Operating Activities |
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-256 |
10,855 |
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Cash
Flows from Investment Activities |
-7,009 |
-5,203 |
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Cash
Flows from Financing Activities |
10,738 |
-8,420 |
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Cash,
Bank Deposits at the Term End |
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23,486 |
21,919 |
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ANALYTICAL RATIOS Terms
ending: |
31/03/2008 |
31/03/2007 |
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Net
Worth (S/Holders' Equity) |
208,377 |
211,672 |
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Current
Ratio (%) |
168.33 |
164.65 |
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Net
Worth Ratio (%) |
49.63 |
50.06 |
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Recurring
Profit Ratio (%) |
3.25 |
3.31 |
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Net
Profit Ratio (%) |
1.31 |
1.93 |
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Return
On Equity (%) |
4.80 |
6.41 |
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FOREIGN EXCHANGE
RATES
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Currency |
Unit
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Indian Rupees |
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US Dollar |
1 |
Rs.42.82 |
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UK Pound |
1 |
Rs.84.89 |
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Euro |
1 |
Rs.68.07 |
RATING
EXPLANATIONS
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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>86 |
Aaa |
Possesses an extremely sound financial base with the strongest capability
for timely payment of interest and principal sums |
Unlimited |
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71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
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56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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26-40 |
B |
Unfavourable & favourable factors carry similar weight in credit
consideration. Capability to overcome financial difficulties seems comparatively
below average. |
Small |
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11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
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<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
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NR |
In view of the lack of information, we have no basis upon which to
recommend credit dealings |
No Rating |
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This score serves as a reference to assess SC’s credit risk
and to set the amount of credit to be extended. It is calculated from a
composite of weighted scores obtained from each of the major sections of this
report. The assessed factors and their relative weights (as indicated through
%) are as follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend
(10%) Operational
size (10%)